American companies were forbidden to supply components to China’s ZTE

The Commerce Department, the U.S. banned American companies to supply electronic and other components of the Chinese Corporation ZTE, which produces a variety of telecommunications equipment. The decision came into force immediately after publication.

This decision can have a devastating impact on ZTE as vendors of the USA cover 25-30% of its needs.

This decision was made after the trial on which the Chinese company has pleaded guilty to the supply of U.S. goods and technology to Iran in circumvention of U.S. sanctions.

ZTE paid 890 million dollars in fines and can pay an even 300 million, if the verdict of the court.

According to the court agreement, ZTE is also committed to fire four top managers and to punish another 35 of its employees, who acted in circumvention of the sanctions. The U.S. Department of Commerce alleges that this condition was not fulfilled.